The Denver Nuggets Are Running in Place and Might be in Serious Trouble

On the eve of the 2017-18 NBA preseason—coming off a year in which they finished one game back of the eight seed—the Denver Nuggets were expected to compete in a playoff series for the first time in five years. On March 1st, one game into Paul Millsap’s long-anticipated return from wrist surgery, their odds to make the playoffs were a little higher than a coin flip. Today, with the NBA’s third-toughest remaining schedule staring them in the face, that likelihood has dropped all the way down to 12 percent.

Labeling Denver’s late-season struggle as a “collapse” feels a little harsh given all the injury-related obstacles they’ve had to overcome, but luck—particularly as it relates to health—is part of the game, and doesn’t make this season feel any less like the missed opportunity it’s been. Their flickering disappointment generates several questions about the future of a young team that entered this season with enough momentum to garner playoff expectations.

Millsap’s injury, which kept the four-time All-Star sidelined for over half of this season, is the most obvious culprit; Denver went 24-20 and ranked 18th in net rating during his absence. But assimilating him back into the fold hasn’t been easy. Since the All-Star break, Denver has steered back into their hapless, asymmetrical identity. (Even though they’ve done a pretty good job limiting quality three-point looks, opponents are shooting 41.9 percent when “wide open” this season, which is worse than any other team. Bad luck strikes again!)

There have been positive signs with Millsap on the floor, but overall this team’s shape hasn’t changed much from a year ago. They finished last season with the worst defense in the entire league and an offensive attack that took a backseat to no one after the All-Star break. That’s essentially still the case. In other words, they personify Nikola Jokic, their indispensable benefactor who’s best measured by the number of jaws left agape every time he makes a pass. Jokic is vulnerable (though not hopeless!) on one end and invincible on the other.

Already one of the league’s best spot-up shooters and post-up threats—a gifted rebounder and put-back artist who makes drawing fouls look easy—Jokic is a perennial All-NBA talent who’s currently on track to join Kevin Garnett and Wilt freaking Chamberlain as the only big men to ever average at least 17 points, 10 rebounds, and six assists per game for an entire season.

He’s also only 23 years old, in his first season as a full-time starter, with plenty of room for improvement in easily-improved areas, like physical conditioning. Combine him with Gary Harris Jr. (a 23-year-old building block whose recent knee soreness couldn’t have come at a worse time), and Jamal Murray (a sparkling 21-year-old), set all three on a path to develop as one of the more impressive and aesthetically enjoyable young cores in the league, and the future should automatically be bright.

But after a season in which little tangible progress was made on the whole, the Nuggets suddenly find themselves in a financial bind their collective skill and trajectory may not be prepared for.

Jokic has a $1.6 million team option this summer. If the Nuggets decline it, he becomes a restricted free agent who will immediately command a max deal (approximately $146.5 million over five years). There's a caveat that we'll explain momentarily, but it's still what Denver should do.

Unless Wilson Chandler opts out of his deal and/or other salary is shed (unlikely unless they're willing to fork over a draft pick as compensation), this team will pay the luxury tax next year, before they've shown playoff pedigree. This thanks to Millsap falling into their lap on a three-year, $90 million deal last summer (including a $30.5 million team option in 2019-20), and the decision to pay Mason Plumlee $41 million over three years, which never made sense. (And even though Kenneth Faried's deal expires after next year, it's still not great.)

Under owner Stan Kroenke, who purchased the Nuggets in 2000, Denver's payroll has only landed in the top 10 three times—all during Carmelo Anthony's prime. It's not impossible to imagine them plunging into the tax for an unproven roster (or even re-signing Jokic this summer and managing to avoid it), but the repeater tax is a legitimate concern that may influence ownership's upcoming decisions.

Looking a little further down the line, if Murray is worth his own max deal as soon as he becomes eligible, the Nuggets will have about $76.8 million (aka about two thirds of the estimated salary cap) tied up in him, Jokic, and Harris for the 2020-21 season. This assumes Millsap is gone and Will Barton was never re-signed to a long-term agreement. It also doesn’t factor in Trey Lyles, a 22-year-old former lottery pick who already deserves more minutes.

If the Nuggets pick up Jokic’s team option and both Darrell Arthur and Chandler opt into their respective contracts, the team can probably still avoid the tax while re-signing Barton on a longer deal. That sounds nice, but doing so would create a precarious situation. Instead of becoming a restricted free agent this summer, Jokic would become an unrestricted free agent in 2019, free to explore greener grass (not a weed-related pun) in a different city.

Even though Denver would remain the only team that can offer Jokic a five-year deal, this route is still waaaaaay too risky. So much can go wrong! What if Millsap suffers another injury and they miss the playoffs again? Or Murray languishes unexpectedly? Or any of another dozen calamities occur? Holding on to a savant who’s somehow even more productive than captivating, on a five-year deal before his 23rd birthday, is a gift. Barring a wink-wink deal that promises he’ll re-sign no matter what, declining the team option and locking Jokic up as soon as possible is the safe way to go.

But that doesn't mean all their problems are solved. Even though Denver’s defense has actually been *a lot* better with Jokic on the court—a trend that goes back to his rookie year—it’s still not great. And even though the Nuggets are about league-average on that end when Millsap plays, their defense has sprung countless leaks when he shares the floor with Jokic.

As a whole, Denver miscommunicates on switches, are out of position and ill-timed when trying to double the post, and sabotage any momentum they can muster with an endless stream of sloppy turnovers. Here’s Chandler and Devin Harris botching what should be a straightforward switch:

Mistakes like this seemingly occur once or twice every time I watch Denver play. Some of it’s correctable, and some feels like an ingrained glitch. Last year they forced the fewest turnovers in the league. They dropped bigs on the pick-and-roll, stayed home, and did a pretty good job limiting three-point attempts. Their defense is still flimsy, but jumped from dead last to 21st because of a more aggressive scheme that forces Jokic to be active on the perimeter.

That’s a willful hazard, considering his slow feet and penchant to wear down as the game goes on (Jokic’s field goal and three-point percentages are consistent through the first three quarters, then plummet in the fourth) but given how unstoppable the Nuggets look on offense when at full strength, getting by with inconsistent defense may be possible. (For the season, Denver’s net rating when Jokic, Murray, Harris, and Millsap share the floor is +12.8 in 413 minutes.)

If Mike Malone is replaced this summer, it’ll be interesting to see what structural changes are made to Denver’s defensive system. Malone is a disciplinarian who deserves credit for instilling confidence in Murray while overseeing obvious growth in Lyles, Jokic, and Harris. It’s not his fault Millsap needed wrist surgery. But defense was supposed to be his calling card, and after two “close but no cigar” seasons in which inept play on that end was the primary reason why the Nuggets didn’t make the playoffs, it shouldn’t surprise anyone if he’s let go.

That’s sort of a shame, because Denver does neat stuff on offense that stretches beyond Jokic’s genius. Here's a nifty end-of-quarter action where Millsap fakes like he's going to set a high screen for Murray, then darts back to the elbow and picks T.J. McConnell off a bit lower on the floor. Murray is good enough to crack the 50/40/90 club multiple times in his career, and it's smart of Malone to take advantage of all the different ways he can do damage.

The Nuggets are young and good. But most teams on their timeline aren’t also forced to spend tons of money to sustain their momentum. There are no promises in the NBA, and growth is not linear. If Jokic never makes necessary steps to improve his defense, Denver’s odds to ever legitimately contend for a championship are slimmer than they’d normally be, considering the lack of financial resources to support him. (Millsap is a sensical piece, but he’s also almost exactly 10 years older than Jokic.)

Locking into a core can be scary, especially one that's totally unproven, in a market that has historically struggled to attract free agents. The Nuggets own all their own first-round draft picks, but are already too good to sink into the lottery. (Whiffing on Emmanuel Mudiay didn't help.)

After a frustrating season that essentially saw them run in place, it's easy to see how this team can quickly wedge itself in a rung of mediocrity for the foreseeable future. Of course, if Murray becomes the next Damian Lillard (except already a decent defender) then the path to something greater is clear. If not, maybe breaking up the core and re-tooling around Jokic with more established talent (that has a lower ceiling) is the way to go. But for the time being, cautious optimism is as good as it gets for an organization that backed itself into a corner at a really unfortunate time.